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Uniform guidance on property management for federal grantees

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Uniform Requirements on managing equipment and property are challenging for many federal grantees.

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Uniform guidance on property management for federal grantees

  1. 1. Equipment Management Challenges to Federal Grantees E-ISG Asset Intelligence (www.e-isg.com) February, 2016
  2. 2. Equipment Management – Why It Matters to Federal Grantees?  Know what you have, where they are – reduce costs and institute accountability  You are required by Uniform Guidance or CFR (Code of Federal Regulations)
  3. 3. Guidelines – Uniform Guidance “A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated.” – §200.313 Equipment Management of 2 CFR 200, Uniform Guidance (Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards) Effective date: Federal Agency Implementation effective 12/26/14
  4. 4. Relevant Definitions in Uniform Guidance Acquisition Cost:  Cost of the asset including the cost to ready the asset for it’s intended use. (example: Invoice price plus modifications, attachments, accessories, or auxiliary apparatus necessary to make it usable for the purpose it was acquired) Capital Assets:  Tangible or intangible assets used in operations having a useful life of more than one year, which are capitalized in accordance with GAAP. Equipment:  Tangible personal property (including IT systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the entity, or $5,000.
  5. 5. Management of Property and Equipment  Physical inventory of the property must be taken at least once every 2 years  Must establish a control system to ensure adequate safeguards to prevent loss, damage or theft  Adequate maintenance procedures must be applied to keep property in good condition  Property records must be maintained and include the following:  Description - Acquisition date - Condition  Unique identification # - Cost - Percentage of  Source of funding - Location Federal participation  Who holds title - Use Source: UNIFORM ADMINISTRATIVE REQUIREMENTS, COST PRINCIPLES, AND AUDIT REQUIREMENTS FOR FEDERAL AWARD, Dec’14
  6. 6. Insurance Requirement  Items <$5,000 can be retained with no further obligation to Federal awarding agency  Items >$5,000 may be retained or sold & non-federal entity would compensate Federal agency for their share. This is default if agency does not respond to request within 120 days.  Transfer title to the Federal Government or eligible third party
  7. 7. Disposition of Equipment  Items <$5,000 can be retained with no further obligation to Federal awarding agency  Items >$5,000 may be retained or sold & non-federal entity would compensate Federal agency for their share. This is default if agency does not respond to request within 120 days.  Transfer title to the Federal Government or eligible third party _
  8. 8. Track depreciation on Equipment  Required -- replaces use allowance  Consider and establish useful life or use of service  Depreciation method – straight line method.  Cannot be changed without approval
  9. 9. Key Challenges for Federal Grantees Track equipment by funding codes – often one equipment has multiple funding sources Handle disposition efficiently – recording disposition methods, sales prices, transfer Track the location, use, and condition of equipment at all times Transfer equipment among different projects and keep record of these transfers Conduct inventory audit in a cost efficient way Optimize insurance premium Institute system control of assets to prevent loss/theft/damages Track depreciation on equipment efficiently
  10. 10. 10 Signs – You Need Help… 1. Excel sheets/ Access database are used for tracking equipment and supplies 2. The Accounting Department spent many hours to reconcile – every month 3. No periodic inventory audit checks 4. struggle to provide accurate information to the insurance providers 1. No dedicated owner of the equipment management function 2. Believing that the fixed asset management software is taking care of equipment management 3. Only tracks items with >$5000 in purchase value, can’t track others – too many of them. 4. No equipment management procedures 5. No training on equipment management procedures 6. Just failed the most recent financial audit on inventory control
  11. 11. How E-ISG can Help  Provide Commercial Off the Shelf Software eQuip! to automate the processes  Low cost  Easy to use  Easy to implement  Already serve many federal grantees, visit our website for more information and don’t’ forget to download the case study.  http://www.e-isg.com/equipment- management-for-non-profit/
  12. 12. How to Contact Us  Email: sales@e-isg.com  Call: 1-866-845-2416, ext. 2  Visit our website: www.e-isg.com

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